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TMI Blog1968 (7) TMI 61X X X X Extracts X X X X X X X X Extracts X X X X ..... n assessed to sales tax by an order of assessment made on 6th December, 1962. The turnover relating to the years 1959-60, 1960-61 and 1961-62 formed the subjectmatter of subsequent assessment proceedings in which assessments were respectively made in the years 1963, 1964 and 1965. When the tax and penalty payable by Kabadi were not paid by the petitioner, an application was presented to the judicial Magistrate, Gadag, under section 13(3) of the Act for their recovery. The petitioner's objection to that recovery which rested on more than one ground was negatived, and these revision petitions are directed against the orders made by the Magistrate in that way. Mr. Srinivasan advanced three arguments on behalf of the petitioner. The first was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... abadi who was the dealer was a party, and in none of these proceedings was the petitioner a party. Similarly the imposition of penalty was only on Kabadi and not on the petitioner. The question is whether merely for the reason that the petitioner became the transferee of the whole of the business of Kabadi on 28th February, 1963, the tax and the penalty payable by the dealer under the relevant orders of assessment made in that regard became payable and could be recovered in a proceeding under section 13(3). Now, section 15(1) transmits in some measure the liability of a dealer to pay tax or penalty to a person who is the transferee of the entire business of the dealer, although the dealer also continues to be liable to pay the amount due fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le by the dealer in respect of those years did not become payable by the petitioner, and no application could have been made under section 13(3) to the Magistrate for its recovery. But with respect to the period between 1st April, 1962, and 30th June, 1962, the order of assessment had already been made when the petitioner purchased the business of Kabadi. So unless it could be said that the provisions of section 15(1) are unconstitutional, the petitioner became liable to pay the tax so determined by the order of assessment which the dealer had become liable to pay when he made a transfer of his business to the petitioner. Similarly if any penalty had been imposed by then, that penalty also became payable. But the question is whether that l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssment was made in any proceedings to which the petitioner was a party. The tax or penalty which the petitioner was called upon to pay became payable not because it was a tax in respect of which there was an assessment made in the case of the petitioner, but because although it was a tax assessed on the dealer the liability of the dealer to pay such tax or penalty devolved on the petitioner by reason of his purchase. It is not the assessment which created the petitioner's liability. The source of that liability was the purchase. So what the petitioner was demanded to pay was not any tax or penalty which was "assessed" within the meaning of that expression occurring in section 13(3). The other category to which section 13(3) refers speaks o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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